The Investing and Saving Alliance (TISA) has called for clearer guidance from the Financial Conduct Authorty (FCA), to help firms understand and follow new rules on non-financial misconduct.
TISA submitted its response to the FCA’s consultation CP25/18 today (11th September), and said some areas were still unclear, which could make things harder for firms and stop consumers from seeing the benefits the FCA wants.
TISA asked the FCA to sort out three main points.
First, it said the FCA should define what counts as a ‘non-bank’ or say if all activities within a core or enhanced firm are covered by COCON in the same way as banks.
TISA said that without this, firms could face higher risks if they dismiss someone or record a negative regulatory reference for non-financial misconduct.
There was also a concern that ‘non-bank’ might be taken to mean different things, which could lead to unfair competition and weaker standards.
Additionally, TISA said the FCA should scrap the idea of unreportable conduct rule breaches to remove confusion over what counts as a breach.
It noted that this would match current industry practice, as firms can already look at this behaviour when deciding if someone is suitable for a regulated role.
TISA also asked for clear advice on what firms must look at and report when it comes to someone’s private life.
It said forcing firms to consider allegations that are unproven and happened outside work would be too much and could lead to legal and reputational risks for both firms and the FCA.
Phil Turnpenny, policy executive at TISA, said: “Tackling non-financial misconduct is vital for raising standards and improving consumer trust in financial services.
“Further guidance and clarification can ensure that the rules are implemented in a clear, fair and consistent manner.
“Clarity on ‘non-banks’, alignment of guidance with current industry practices, and clear guidance on what information firms have to consider will ensure that consumers, firms and the FCA will benefit from changes to the non-financial misconduct framework.”
Turnpenny added: “We look forward to continuing to work with the FCA to ensure the necessary clarification, guidance and support are provided to help firms navigate these changes successfully.”
